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Adidas earnings on track for 2003
FRANKFURT, Germany (Reuters) -- The world's second-biggest sporting goods maker Adidas-Salomon on Wednesday beat expectations with an 11 percent rise in third-quarter operating profit, helped by a rise in sales of its sports shoes. "We've faced a number of economic, political and market challenges in the first nine months of 2003, and overall have delivered excellent sales and earnings performances,'' Adidas Chief Executive Officer Herbert Hainer said in a statement. The company said operating profit came in at 270 million euros ($309.8 million) in the third quarter, beating forecasts of 254 million euros in a Reuters poll of 16 analysts . For the full year, the creator of three-striped shoes repeated its goals of 10-15 percent growth in net profit and five percent growth in sales on a currency neutral basis. Its backlog of footwear orders, which indicates future sales, fell 10 percent in currency neutral terms, continuing to suffer in the difficult U.S. market. Adidas has said its 2003 sales will sink in currency-neutral terms in the U.S. market, the world's biggest footwear market. Its group gross margin -- a closely watched measure of its profitability -- has increased 1.2 percentage points to 45.0 percent in 2003. That margin sets it behind its zesty smaller German peer Puma which last week said its profits more than doubled as it continued to exploit its booming demand for shoes which mix fashion and sports. The third quarter is important for sports shoe makers as it includes the back-to-school shopping spree. Puma and Adidas have both kept their headquarters in the tranquil Bavarian town of Herzogenaurach where they were established by two brothers in 1948. Adidas is about twice the size of Puma. The world's top sports good maker is U.S. giant Nike. Copyright 2003 Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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